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Argentina's YPF Seeks Waivers To Avoid Accelerated Debt Repayment

By Ken Parks OF DOW JONES NEWSWIRES BUENOS AIRES -(Dow Jones)- Argentina's state-run oil company, YPF SA (YPF, YPFD.BA), said Wednesday that its management is pursing waivers from creditors to avoid the accelerated repayment of more than a billion dollars in debt. In its 20-F filing with the U.S. Securities and Exchange Commission, YPF said that its recent nationalization by the Argentine government might constitute a default on about $1.6 billion of its debt, which would trigger early repayment. "In case those waivers are not obtained and immediate repayment is required, the company could face short-term liquidity problems. However, management expects that in such case it could obtain financing from several sources, including the company's operating cash flows and available credit lines," YPF said. YPF reported total debt of $2.97 billion at the end of 2011. Earlier this month, President Cristina Kirchner expropriated a 51% stake in YPF from its controlling shareholder, Spain's Repsol YPF SA (REP.MC). Repsol's stake in YPF has now been reduced to about 6%. Kirchner accused Repsol of not investing enough in Argentina to reverse years of declining oil and gas production that have turned the South American nation into a net energy importer. Repsol has denied those accusations and demanded about $10 billion in compensation. Argentina's National Appraisal Court will determine what compensation, if any, Repsol receives in a process that could take up to three years. Kirchner has pledged to make YPF a model state company. To that end, she named former Schlumberger executive Miguel Galuccio as YPF's new chief executive. YPF said its developing a new business plan in accordance with the goals set forth in the Expropriation Law. The law declares achieving hydrocarbon self-sufficiency as well as in the exploitation, industrialization, transportation and sale of hydrocarbons, a national public interest and a priority for Argentina. That has raised concerns that the government might force YPF to foot what is likely to be a hefty fuel import bill this year. Argentina imported $9.4 billion in fuels and lubricants in 2011, more than double the previous year. Those fears aren't without some foundation. YPF noted in its 20-F that the Energy Secretariat has ordered the company to supply natural gas to the domestic market on several occasions since 2004 in the absence of a contractual commitment to do so. The government has indicated it won't move against YPF's minority shareholders. Deputy Economy Minister Axel Kicillof, the intellectual author of the takeover, recently said that shareholders stand to benefit from state management at YPF. Argentina's Eskenazi family through its Petersen Group holding company owns 25.46% of YPF, while 17.09% trades on exchanges in New York and Buenos Aires. But the rapid plunge in YPF's shares has erased billions of dollars of market capitalization. YPF's American Depository Shares closed almost unchanged at $14.22 on Tuesday, bringing their year-to-date loss to 59%. YPF said that it currently isn't in compliance with New York Stock Exchange listing requirements regarding its audit committee, whose powers have been transferred to the provisional management team that will run the company until mid-June. "If we fail to cure this deficiency, NYSE rules provide that the NYSE may initiate suspension and delisting procedures with respect to our securities," it said. YPF's ADS was recently down 1% at $14.01 on Wednesday morning. -By Ken Parks, Dow Jones Newswires; 54-11-4103-6740, ken.parks@dowjones.com